Our Overwrought language award this week comes from Kevin Drum of Mother Jones, writing about Paul Ryan's budget plan. Drum calls Ryan's budget a "Vision of a Dickensian Hellhole". He quotes Jonathon Chait as saying, "Its enactment would amount to the most dramatic rollback of government since the New Deal."

All this for a budget that proposes to reduce government spending to about 19% of GDP, a level that we have not seen since the Dickensian Hellhole of ... the Bill Clinton Presidency. During the New Deal, spending hovered around 10% of GDP.

This is the ratchet effect that big government lovers are so adept at employing. Under President Obama (with a lot of help from George Bush and a Democratic Congress) spending has skyrocketed to an unprecedented-except-in-WWII level of over 25% of GDP. But suddenly Drum and Chait and company want to define that level as the new baseline, below which any drop is now "Dickensian." Which is another reason that we should never, ever create a new government spending program because once established they are impossible to eliminate, no matter how stupid and wasteful.

Dynamic scoring of budget proposals has been on the Republican wish list for decades. They have always been frustrated that tax cut proposals look like such budget losers with static scoring. In their supply-side bones, Republicans know that tax cuts will stimulate economic activity and thus increase future tax revenues. Taking this second order effect into account is what they mean by dynamic scoring (see: Laffer Curve).

I have some sympathy for this argument, but in making it Republicans are falling for the "this will work great when our guys are in charge" fallacy (I need to find a name for that). Democrats fall into this all the time, expanding government power only to be shocked at what their political enemies do with this power once in charge.

Because it is pretty clear what dynamic scoring will mean in a Democratic Congress. Remember that stimulus bill? Democrats all thought that expanded the economy, so its costs would, by their Keynesian assumptions, appear much lower under dynamic scoring. The Left thinks the auto bailout was stimulative. They even think that Obamacare was stimulative. Do you really want some BS Keynesian fudge factor obscuring the true cost of such proposals in the future?

Related: Greg Mankiw discusses why, if I read him right, dynamic scoring is impossible to do correctly

I have had hard time parsing exactly what the intelligentsia means by "incivility." On the one hand, they often call for more civil discourse and lament the lack of incivility in government nowadays. But on the other hand, people like Obama very frequently argue by ad hominem attack, preferring to question the motives of the NRA or climate skeptics rather than engage their criticisms of gun control or CO2 limitations.

This has confused me, because I have always defined civility in discourse as the willingness to accept your opponent as a person of good will who merely disagrees or is misguided. But if this is civility, why the frequent "othering" of political opponents by the same folks calling for civility?

Well, it turns out I have been using the wrong definition of civility. As Donna Brazille makes clear, "incivility" means criticizing the President or attempting to hold him accountable for missteps of those who report to him. She actually beings by defining civility in a way with which I mostly agree:

A government of, by, and for the people requires that people talk to people, that we can agree to disagree but do so in civility. If we let the politicians and those who report dictate our discourse, then our course will be dictated.

And that, according to acting Commissioner Steven Miller, who just resigned, the problem started because the Supreme Court's Citizens' United decision created a surge of requests by political groups for tax-exempt status.

LOL - don't let politicians dictate our course - but everyone needs to shut up and take the word for two IRS officials that there is no scandal here (noting that we know from the IRS's own data that the last statement she urges us to accept in the name of civility is definitely false). Further, she says

Why am I alarmed? Because two "scandals" -- the IRS tax-exempt inquiries and the Department of Justice's tapping of reporters' phones -- have become lynch parties. And the congressional investigation of Benghazi may become a scandal in itself.

So let's of course all be civil, and civility means calling folks criticizing a black President "lynch mobs."

By the way, a bit off-topic, but this paragraph is a textbook example of tricks editorial writers use

The IRS scandal has sparked bipartisan outrage that should require a bipartisan solution. The director who oversaw this was a Bush appointee who was confirmed by a Democratic Congress. Even Watergate reporter Carl Bernstein says he doubts very much that Obama was involved

Each sentence here as a master-stroke of the spinmeister's pen trying to defend her guy in the White House.

Note the effort in the first sentence to shift this to a bipartisan issue. Both sides are upset. It is a good government issue. The implication we are supposed to draw is that this no longer can be a critique of this particular administration. It has transcended. This is how red-blue team political invective works. If the outrage is coming from just one party, it should not stick to the President because because it is petty partisanship. If it comes from both sides, it should not stick because it is a larger issue for all of us that transcends this particular Administration. In fact, through the article, she actually makes both arguments simultaneously. Brilliant!

It's Bush's fault. This is just so well-worn that Obama officials simply cannot help themselves. How can a man the Left thought to be so stupid and incompetent still be directing affairs four and half years after he left the building?

This one is really funny. Is, as implied by the structure of this sentence and the world "even", Carl Bernstein the least likely imaginable person to excuse Obama of such a charge? I think I am going to start writing this way. Even Warren Meyer thinks climate change has been exaggerated. Even Kim Kardashian thinks its important to get a lot of PR. Even Tia Carrere says its OK to make a bad movie once in a while. Hey, this is fun.

By the way, as I wrote before, it is unlikely Obama gave a specific order to harass the tea party. However, he has created a strong culture of "othering" his political enemies and impugning their motives as evil, sending a strong signal to his supporters such that actual orders were unnecessary. No one ordered from the top that Princeton students harass Yale at every opportunity (or even better, Penn). The culture takes care of it.

What I will say is that folks who have enthusiastically supported the war should understand that the war is going to have the following consequences:

In 2009 we will have a Democratic Congress and President for the first time since 1994.

The next President will use the deficits from the $1.3 trillion in Iraq war spending to justify a lot of new taxes

These new taxes, once the war spending is over, will not be used for deficit reduction but for new programs that, once established, will be nearly impossible to eliminate

No matter what the next president promises to the electorate, they are not going to reverse precedents for presidential power and secrecy that GWB has established. Politicians never give up power voluntarily. [if the next president is Hillary, she is likely to push the envelope even further]. Republicans are not going to like these things as much when someone of the other party is using them.

1. The prediction was 100% correct, and in fact even went further as the donkeys gained a filibuster-proof majority in the Senate, at least for a year. Though the war likely had little to do with the outcome, which was driven more by the economy

2. Dead-on. Five years later Obama still blames the deficit on Bush. This is no longer true -- Obama has contributed far, far more than Bush to the deficit -- but the Republicans' fiscal irresponsibility during their tenure have robbed them of any credibility in criticizing Obama

3. Mostly true (and usually a safe bet with government). Tax increases were deferred for four years due to an economy I had not foreseen would be so bad, but they are coming. At the time, it seemed logical to blame a lot of the deficit issues on war spending. Today, though, 1.3 trillion is barely 8% of the debt and is almost trivial to more recent money wasting activities.

4. Absolutely true. In spades. The only thing I missed was I thought Obama might be less likely to go overboard with the whole executive authority and secrecy thing than Hillary, but boy was I wrong. Obama has absolutely embraced the imperial presidency in a way that might have made Dick Cheney blush. Accelerated drone war, constant ducking of FOIA and transparency, increased use of treason laws to prosecute whistle blowers, claiming of power to assassinate Americans on the President's say-so, accelerated warrant-less wiretapping, using executive orders to end-run Congress, etc. etc. And I never guessed how much the media which so frequently criticized Bush for any expansions in these areas would roll over and accept such activity from a President of their party.

GM, as reported by Reason's Hit and Run, has actually already had something of a breakthrough in labor costs, at least for new employees:

The current veteran UAW member at GM today has an average base wage of $28.12 an hour, but the cost of benefits, including pension and future retiree health care costs, nearly triples the cost to GM to $78.21, according to the Center for Automotive Research.

By comparison, new hires will be paid between $14 and $16.23 an hour. And even as they start to accumulate raises tied to seniority, the far less lucrative benefit package will limit GM's cost for those employees to $25.65 an hour.

So this puts GM in the position of shoving experienced employees out the door as fast as they can, to make way for lower cost employees hired under this new deal. Apparently GM also has more flexibility to manage costs in a downturn. Good news, assuming they can accelerate a 20 year demographic transition to about 6 months, avoid giving away too much to these newer workers when times are good again, and arrest market share declines with better cars. Oh, and I presume the UAW has not abandoned seniority, which means that in recession-driven layoffs over the next year, GM must being by laying off these much cheaper younger workers. Layoffs will actually mix their labor cost upwards.

I still don't want to bail them out. Like numerous other industries, from steel to airlines, there is no reason GM shouldn't have to pass through Chapter 11 on the road to recovery. However, the argument that GM is turning a corner if we just give them a little help seems to be persuasive with many folks around me, so much so I am tempted to buy some GM stock as a way to go long on my prediction of the creeping corporate state.

Cash-strapped General Motors Corp. said Monday it will delay reimbursing its dealers for rebates and other sales incentives, an indication that the company is starting to have cash-flow problems....Erich Merkle, lead auto analyst at the consulting firm Crowe Horwath LLP, said GM wouldn't delay payments if it had enough cash.

In the third quarter of this year, GM's operations burned through $7.5 billion in cash, offset somewhat by asset sales and financing activities. But this is really a pre-recession burn rate. What will the burn rate be over the next 6 months? There is an argument to be made that $25 billion is not going to last even a year, particularly given the dynamic that layoffs will hit mostly the lower-cost workers, and a Democratic Congress and Administration that is handing over the money may well restrict GM's freedom of movement on layoffs anyway. I can see the Obama administration now -- don't lay them off, lets put them all in a factory making green energy, uh, stuff.

"I don't even think they've got 60 days," Merkle said. "Their cash position is probably getting pretty weak right now, and it's cutting into those minimum reserves that they need on hand."

James Pethokoukis argues that we might have spent a lot of the $1.3 trillion cost of the Iraq war on containment of Iraq had we fought the war.

I will admit I have not seen the studies, but I declare right now that there is NO WAY. If we really would have spent $150 billion a year containing Iraq in absence of a war, we should be spending similar magnitudes today on other similar regimes on which we have chosen not to declare war, like Iran, North Korea, Venezuela, etc. But demonstrably we are not. One might argue that oil prices would be lower, I guess, but one could also argue that the post-9/11 recession would not have been as deep without a war. I am sure there is a broken window fallacy in here somewhere. This reminds me nothing so much as the tortured economic studies that purport to show a gullible populace that it makes sense to build a billion dollar stadium for the hapless Arizona Cardinals because the city will make it all back in future revenues. Sure.

I am not going to argue the justifications for the Iraq war here. What I will say is that folks who have enthusiastically supported the war should understand that the war is going to have the following consequences:

In 2009 we will have a Democratic Congress and President for the first time since 1994.

The next President will use the deficits from the $1.3 trillion in Iraq war spending to justify a lot of new taxes

These new taxes, once the war spending is over, will not be used for deficit reduction but for new programs that, once established, will be nearly impossible to eliminate

No matter what the next president promises to the electorate, they are not going to reverse precedents for presidential power and secrecy that GWB has established. Politicians never give up power voluntarily. [if the next president is Hillary, she is likely to push the envelope even further]. Republicans are not going to like these things as much when someone of the other party is using them.

So I guess the Democratic response to the Bush administration's 8-years of disrespect for the separation of powers is to one-up him?

On the op-ed page of the New York Times,
Jean Edward Smith argues that if the Roberts Court keeps on its current
path, a future Democratic President and Democratic Congress should
consider a court-packing plan and add Justices to ensure a liberal
majority on the Supreme Court. This might be necessary, Smith contends,
because the Roberts Court has "adopt[ed] a manifestly ideological
agenda," "plung[ing] the court into the vortex of American politics"
where it now decides political questions rather than the purely legal
decisions of the Warren Court.

And by the way, I would have said that the Roberts court has followed a distinctly non-ideological agenda. In fact, I can't figure out how they are making decisions from one case to the next. This court bears the hallmarks of one that is really evenly divided, with backroom negotiating going on to get a majority that reeks of compromise rather than anything either ideological or Constitutional. Every major decision seems to have five or six written opinions.

Apparently, the Democratic Congress is trying to "take on" high executive pay with some kind of punitive taxation plan. This fits well into a class of legislation I would describe as "useless at best, probably counter-productive, but of high symbolic value to our base," something to which both parties are unbelievably susceptible.

I'm confused, by the way, about why exactly I should care how much CEOs are paid, particularly for executives that don't work for companies in which I own stock? I don't think Paris Hilton, George Clooney, or the CEO of Home Depot are worth what they are paid, but I don't know how it affects me except perhaps for some simmering envy. Does anyone with above a 5th grade education really believe that they will pay one cent less for gas or a refinery worker will make one dollar more if the CEO of Shell is paid less?

I do understand why the shareholders of Home Depot might be pissed off about what they were paying their CEO, or more accurately, what they paid him to go away. I am sure the Arizona Cardinals felt the same way about Dennis Green. Now, if Democrats wanted to suggest that shareholder voting and corporate governance rules needed to be amended to make it easier for shareholders to hold managers accountable for bad decisions and to overrule sweetheart deals between buddies on the board, I am very open to listening.

One might be led to believe that the Democrats were finally going to address the corporate welfare issues they have been promising to deal with for years. Unfortunately, it appears that they are really only looking for an excuse for some populist demagoguing against Exxon. Subsidies still appear to be A-OK:

The Cato Institute's Jerry Taylor and Peter Van Doren are all in favor of eliminating energy subsidies. By that measure, they find
the House Democrats' 100-hour energy legislation -- H.R. 6, the
Creating Long-Term Energy Alternatives for the Nation Act (aka the
"CLEAN Energy Act") -- to be quite a disappointment.

Energy subsidies, of course, have been a historical disaster. If you have ever traveled around California, a common site you will see is 1) Windmills that are not working and 2) Rooftop solar fixtures that appear badly broken. That is because these facilities were installed cheaply as subsidy magnets, rather than actual, you know, investments that made any sense. Here in Arizona, every third rich persons SUV has this Arizona environmentally-friendly license plate that says the truck is dual-fuel. When I moved here, I though that was kind of cool. I know several countries that have good CNG (compressed natural gas) economies in their transportation sector. It turns out, though, that none of these vehicles actually fill up with anything but gasoline. Several years ago Arizona had a subsidy for buying dual-fuel trucks that exceeded the cost of conversion, so that everyone did the conversion as a money-maker.

And these are far from being the worst. How many billions have been sunk into R&D rat-holes that have produced nothing except some professor's tenure? Remember that alternative energy and energy conservation technologies are among the hottest sectors in venture capital nowadays. The VC's I know can't get enough of these projects, and are project rather than money limited. This means that every subsidy and grant for energy can only go to one of two places:

Projects that are already going to be privately funded, so that all they do is displace private funding, which makes them a total waste of taxpayer money

Projects that were rejected for private funding as uneconomic or unpromising, such that the spending is a waste unless you assume Congressmen and government bureaucrats are sharper than VC's in picking investments.

My observation is the two political parties differ on subsidies only in terms of style. The Democrats appear to have no problems with subsidies as long as they go to sympathetic and fashionable companies (e.g. Google via net neutrality) rather than companies they have deemed to be unfashionable (e.g. Exxon).

Don Boudreaux has a great response to the growing tide of protectionism, as espoused and defended by Harold Meyerson:

Harold
Meyerson repeats the canard that "globalization entails [a] downward
leveling" of economic well-being ("Tipping Point for Trade," November
11).

This belief is crushed by mountains of evidence. It's
crushed also by its own illogic: if ordinary people are served by being
"protected" from globalization, then they can be made even better off
by being protected from countryization - and better off still by being
protected from townization and neighborhoodization. Protectionist
quackery implies that we achieve maximum prosperity when no one
consumes anything produced by anyone else.